SWITZERLAND Law and Practice Contributed by: Joseph Merhai, Thomas Pasquier and Laurent Schenker, Aegis
and circumstances are unchanged, also extend to prior tax periods by way of rollback. In practice, the duration of an APA is determined on a case-by-case basis. It typically covers three to five years, depending on the nature of the transactions and the expected stability of the underlying facts. Unilateral APAs or transfer pricing rulings with cross- border implications may also trigger spontaneous exchange of information. 9.2 Other Mechanisms Unilateral Tax Ruling In practice, the main instrument for obtaining tax cer - tainty in Switzerland is the unilateral tax ruling. A tax ruling is a binding confirmation, issued at the taxpayer’s request, that the competent Swiss tax authority will accept the Swiss tax treatment of a pro - posed structure, transaction or set of facts as pre - sented. In international tax matters, rulings are widely used to obtain certainty before the implementation of a structure or before a transaction, and materially reduce the risk of subsequent disputes.
More generally, Swiss practice is characterised by a co-operative relationship between taxpayers, advisers and the tax authorities. In many cases, the authori - ties are willing to discuss a contemplated structure or transaction in advance, which can help resolve ques - tions at an early stage and avoid later controversy. In addition, the tax authorities issue administrative guidance and, in certain areas, safe harbour provi - sions, which taxpayers may rely upon when structur - ing and documenting cross-border arrangements. That said, Switzerland does not have a formal co- operative compliance programme comparable to those established in some other jurisdictions.
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